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Complete the answers to the eight questions
at the end of Case
12, “Should Business Hire Undocumented Workers?” pp. 633-636.
1. What are the legal and ethical issues in this case?
2. Is illegal immigration primarily an economic, legal, ethical, social, or
political issue? Explain.
3. Are companies that hire illegal
immigrants being socially responsible? Evaluate this practice using the Pyramid
of CSR introduced in Chapter 2.
4. What are the legal and ethical arguments in favor of continuing to allow
illegal immigrants to be hired by businesses? What are the legal and ethical arguments against illegal immigration?
Which side do you support? Why?
5. Assess the issue of illegal immigration using a number of different ethical principles, such as the principles of
rights, utilitarianism, and justice. What does each principle have to say about
the issue of illegal immigration?
6. With E-Verify making it so easy for companies to obey the law, is there
any excuse for not complying with the requirements of the law?
7. What will be the consequences of the Mohawk decision? Will this deter
companies from hiring illegal immigrants?
8. What is your assessment of the new
Arizona law? Why do states think they need to take action on this issue rather
than waiting for the federal government to act?
Should Business Hire Undocumented Workers?* After many
months of negotiations in 2007, the U.S. Senate’s compromise on a comprehensive
immigration bill failed to pass. The ill-fated legislation contained provisions
that would have hired new border patrol agents, imposed a new system forcing
employers to electronically verify the legal status of applicants and
employees, established a guest worker program, and provided an avenue for
legalization for the estimated 11–20 million illegal immigrants in the country
at the time. 1 Politicians on both sides of the issue held strong positions
regarding the proposed legislation. One group called it an“amnesty”bill and
another group feared it would cost Americans jobs. Politicians of various stripes
supported it because either they approved of the idea or they wanted to be sure
that this burgeoning group would someday vote for them. According to USA Today,
the“ghost of the 1986 failure”haunted the proposal for immigration reform in
2007. 2 As background, it is useful to know that an immigration law was passed
in 1986 that was supposed to deal with the then 3 million illegal immigrants
who were offered legal status in exchange for tough new enforcements that were
to stop the flow of undocumented workers. The 1986 plan turned out to be a
sham. A system was set up in which employers had to accept just about any
document a job applicant submitted to prove his or her legal status. The
by-product of that system was a booming industry in phony documents and at
least 12 million more illegal immigrants. 3 To many, the 1986 amnesty sparked
the larger influx of unlawful immigration and showed would-be migrants that the
United States was weak willed and would eventually cave in and give citizenship
to illegals, thus encouraging many to breach the U.S. borders with renewed
energy. 4 OVER 20 YEARS OF UNCONTROLLED IMMIGRATION Between 1986 and 2007, the
number of illegal immigrants in the United States exploded to somewhere between
11 and 20 million. Estimates vary widely because a valid count is not possible.
Using the figure of 11 million, which is the conservative guess, estimates have
been made about the magnitude of this booming population. Of that population,
it has been reckoned that 56 percent are from Mexico, 22 percent are from other
Latin American countries, 13 percent are from Asia, and the remainder are from
Europe, Canada, Africa, and elsewhere. 5 It is little wonder how the number of
illegal immigrants grew to such a huge size in the intervening 20 years. The
federal government took no action to stem the tide of illegal immigrants, and
many businesses discovered that the workers were willing to take almost any job
at low pay. In most cases, the workers worked hard and made very few demands.
As a result, it became useful to business to fill many jobs that they have said
were not being filled by anyone else. Of course, that statement has been
disputed. Some observers have noted that if businesses had made working
conditions better and raised the wages for some of these jobs, there would have
been plenty of workers. But a black market of cheap labor suppressed any wage
increases. From a societal perspective, the influx of illegal immigrants has
posed many issues for tax-paying Americans who suspect the immigrants are
getting a free ride. They have put pressures on local communities’social
service agencies, school systems, health-care facilities, welfare systems, and,
in many places, increased the crime rate. At the same time, the number of
illegal immigrants has grown so large (11–20 million) that the thought of
rounding them up and deporting them has not been seen as a feasible solution.
Many of the illegal immigrants have now had children, and some are already
third-generation illegals. Two groups have favored amnesty for the illegal
immigrants more than anyone else—the business community, who sees in them a
source of cheap labor, and some politicians who are looking down the road and
speculating that someday these individuals will be their supporters if they are
treated favorably. The business position is of interest to us here. THE
BUSINESS STAKE Business has one of the largest stakes in the issue of what
happens to illegal immigrants. Industries ranging from agriculture to
construction now depend heavily on immigrant labor—legal and illegal. Business
wants a reliable stream of inexpensive workers and has seemed willing to hire
them even if they are undocumented. Business’s preference, of course, is
immigration reform whereby they may hire the workers legally. It has been
clearly seen, however, that in the absence of enforcement, many businesses
disregard the law and hire the illegal immigrants anyway. 6 The business
community has had a number of different groups pushing for immigration reform,
but they represent a few different umbrella groups with no one clearly in
charge. One lobbyist observed that there are“coalitions of coalitions.”Some
want to allow more uneducated, entry-level-type workers who are willing to take
jobs others won’t take. Others want reform allowing more educated and high-tech
workers into the United States. One reason the business groups cannot come
together is that most of them have some issue with different parts of proposed
legislation. 7 A CASE WITH MAJOR IMPLICATIONS A different kind of case in
Georgia may be signaling a turning point for business’s experience with hiring
illegal aliens. A company that has depended heavily on illegal immigrants is
Mohawk Industries, Inc., the $6.6 billion carpet maker in the small town of
Calhoun, Georgia. Mohawk employs 32,000 workers and 4,000 of them are in and
around Calhoun. This small town has been reshaped over the past decade by an
enormous influx of Latinos. At one time, the company was primarily staffed by
whites, but today the workforce comes mostly from Mexico and other Latin
American countries. With wage rates at $7 an hour and higher, Hispanics came to
make up an estimated 12 percent of the population. In 1990, the percentage was
less than 1 percent. 8 Calhoun became the center of one of the most heated
debates over the hiring of illegal immigrants. In 2004, tensions between
immigrants and local workers turned into a legal case that may have significant
implications for companies and communities all over the United States. Four
current and former workers filed a class action lawsuit against Mohawk for
allegedly conspiring to depress wages by hiring illegal immigrants. 9 The
workers claimed they received lower wages because of the depression on wages
caused by Mohawk’s actions. The federal lawsuit claimed that the company, with
the help of local hiring agencies, knowingly accepted false documents,
recruited illegals at the U.S.–Mexican border, and rehired undocumented workers
under different names. Mohawk denied all the allegations. 10 The company
claimed that its contracts with outside employment agencies did not cause
direct harm by the conduct alleged. 11 Businesses have been watching this case
closely because it was filed under the Racketeer Influenced and Corrupt
Organizations Act (RICO). This 1970 law, which was originally intended to fight
the Mafia, assesses triple damages against those companies found guilty of
violations. RICO was amended in 1996 to allow workers to sue corporations that
knowingly hire illegal workers. It turns out there are at least three similar
lawsuits making their way through the legal system. 12 Mohawk appealed the case
all the way to the U.S. Supreme Court. In February 2007, the Supreme Court
declined to consider an appeal by Mohawk. The court’s decision allowed the case
to move forward in federal court. 13 At the time, some lawyers had suggested
that other potential plaintiffs around the country were considering taking
action against their employers. In April 2010, Mohawk finally settled the
lawsuit with its employees, who claimed the company had depressed wages by
hiring illegal aliens. The company agreed to pay $18 million to about 50,000
former and current hourly-paid employees. This was said to be the largest
payout ever in this type of litigation. 14 ENFORCEMENT STARTS TO TOUGHEN UP
Prior to the Mohawk settlement, over the past several years, states, cities,
and local municipalities have started engaging in their own fights against
illegal immigration because the federal government would never take action. 15
In 2007, 18 states passed 57 immigration laws. More than 25 cities and counties
passed measures. Under a Green Bay, Wisconsin, ordinance, a firm could lose its
business license if it hires illegal workers. In Beaufort County, South
Carolina, the county passed an ordinance that says a business could have its
license suspended for hiring illegal workers. 16 Because of the defeat of the
comprehensive immigration bill and the outpouring of citizen criticism against
the federal government for doing nothing, a renewed initiative began taking
place. In Portland, Oregon, federal agents raided a food processing plant over
suspicions that the company hired and employed hundreds of illegal aliens. It
also was reported that in a check of employee records at a Fresh Del Monte
Produce Company vegetable and fruit processing plant in Florida, it was found
that only 48 out of 600 workers had valid Social Security numbers. 17 In Ohio,
the owner of a Fairview restaurant drew a prison sentence of one year for
hiring illegal aliens. He pleaded guilty to inducing, transporting, and
harboring illegal aliens. He not only employed them but also provided them with
housing and drove them to work at the restaurant each day. It turns out the
business owner himself was in the United States illegally, and he faces
deportation after serving his sentence. 18 In August 2007, the Bush
Administration said it would increase its scrutiny of and impose heftier fines
on U.S. businesses that employed illegal immigrants and that it would step up
enforcement despite Congress’s failure to pass immigration reform legislation.
According to then-Homeland Security Secretary Michael Chertoff, employers who
ignored immigration laws would face an increased likelihood of criminal charges
and higher financial penalties. Currently, employers are supposed to verify
that their workers are in the United States legally by collecting their Social
Security numbers and immigration documents. These numbers are then checked
against the government’s database, and employers are notified of those that do
not match. Under the new rule, employers notified of a mismatch would have 90
days to confirm that the employee is in the country legally, or fire them if
they were not. 19 In fiscal year 2006, the government stepped up raids of
companies that used illegal labor and deported a record 185,421 individuals.
The new initiative drew praises from many who have long advocated using
existing laws to crack down on undocumented workers, but criticisms arose from
illegal immigrant advocates and business groups. 20 Throughout 2008 and most of
2009, increased immigration raids continued and put pressure on companies that
had hired illegal workers. In a number of instances these jobs were immediately
filled by American workers. 21 As the recession worsened in 2009, the depressed
economy along with tougher enforcement put unprecedented stress on illegal
immigrants. 22 But when President Obama took office in January 2009, he
presented a different posture toward illegal immigrants. He was more inclined
to support a program that gave some form of amnesty to the undocumented
workers, but nothing was forthcoming. Most enforcement initiatives were
continuing from the momentum started earlier or were occurring at the state and
city levels. Under the Obama Administration, illegal workers are not being
rounded up via raids at factories and farms as was the case under the Bush
Administration before it. The immigration raids have been replaced with a
quieter enforcement strategy—auditing of employers’books. These“silent
raids”involve federal agents going to employers and scouring their employment
records for evidence of illegal hires. The investigations of the past used to
result in the deportation of the illegal hires. The current system requires the
employer to discharge illegal workers. During 2009–2010, Immigration and
Customs Enforcement (ICE) conducted audits at more than 2,900 companies and
levied a record $3 million in civil fines. Employers believe that the audits
reached more companies than were reached
in the work-site raids. In another change, ICE no longer brings criminal
charges against the undocumented workers who lack legal status but otherwise
have clean records. Critics of this system point out that once discovered and
fired, the illegal immigrants are free to seek employment elsewhere. Thus,
there is no way for this approach to purge the workers from the employment
system as long as they keep moving. 23 In spite of a lack of comprehensive
immigration reform, the federal government does require that employers fill out
Form I-9 for each employee, verifying that the workers are U.S. citizens. The
government has even created a special program called E-Verify, which is an
Internet-based, free program run by the U.S. government that compares information
from an employee’s Employment Eligibility Verification Form I-9 to data from
U.S. government records. If the information matches, that employee is eligible
to work in the United States. If there’s a mismatch, E-Verify alerts the
employer and the employee is allowed to
work while he or she resolves the problem. The program is operated by the
Department of Homeland Security (DHS) in partnership with the Social Security
Administration. 24 Because the E-Verify program is free and easy to use, it
makes the verification process straightforward. Employers now have fewer
excuses than ever not to fulfill their obligations. CITIES AND STATES CREATE
THEIR OWN LEGISLATION In 2010, various cities and states continued their tough
enforcement against employing illegal immigrants. Under new legislation in the
State of Utah, employers could be among the first in the country to face
criminal charges for failing to verify their workers’immigration status. 25 In
Pennsylvania, new bills would stop the hiring of illegal immigrants. Under
legislation proposed by Reps. John Galloway and Daryl Metcalfe, companies that
hired foreign workers who had entered the country illegally to work for lower
pay and no benefits would be punished. 26 Galloway stated at a news
conference:“These bills are important because they are about protecting
Pennsylvania jobs.”Metcalfe chimed in by saying that undocumented workers from
other countries“take away the jobs of unemployed Pennsylvania construction
workers”and often use state-funded health-care benefits, unemployment benefits,
and public schools for which they pay no taxes to support. 27 The most dramatic
action taken by a state occurred in April 2010 in Arizona. The state of Arizona
passed a sweeping law that made the failure to carry immigration documents a
crime and gave the police broad power to detain anyone suspected of being in
the country illegally. 28 In a Pew Research Center poll of American citizens
taken in May 2010, 73 percent of those polled approved of the measure requiring
people to produce documents verifying their citizenship status. 29 The Obama
Administration was not happy with the new Arizona law and indicated it would
urge the courts to review the law. With 11–20 million illegal immigrants in the
United States today, the resolution of this issue will not come easily. With
each passing month and year, the consequences and implications of the issue
accumulate and grow more urgent. The resolution will have significant
implications for all sides, not only for business, but for communities, tax
payers, and others waiting to enter the country legally.

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